- Centric Health sharpens focus on high margin healthcare services
businesses, driving sustainable long-term value and growth -
TORONTO, June 23, 2014 /CNW/ - Centric Health Corporation ("Centric Health" or "the Company") (TSX:
CHH), Canada's leading diversified healthcare company, today announced
that it has entered into a definitive agreement to sell its MEDIchair
and Motion Specialties retail home medical operations to Canadian-based
Birch Hill Equity Partners ("Birch Hill") for $50 million.
"Divesting our MEDIchair and Motion Specialties operations achieves two
important strategic objectives for our company," said David Cutler,
President and Chief Executive Officer. "First, it sharpens our focus on
our core strengths as a healthcare services provider, offering
Canadians greater access to a broad portfolio of high quality care
solutions to meet growing needs. Proceeds from the sale will enable us
to invest in new high margin opportunities consistent with this focus
that will maximize the long-term profitability of our platform. Second,
it provides us with additional flexibility as we move forward in our
debt reduction strategy."
The sale represents the first step in the Company's strategic
repositioning to focus on healthcare services businesses with low
working capital requirements and low reliance on government funding and
a national footprint to generate consistent, sustainable growth and
shareholder value over the long term. The Company will host an Investor
Day event to discuss its strategic direction with updates from business
leaders on key initiatives on Tuesday, June 24th in Toronto (see below for details).
Mr. Cutler added, "The transition to Birch Hill provides both employees
and franchisees with new opportunities and resources to allow these
businesses to realize their full potential."
Thecla Sweeney, partner at Birch Hill, said, "MEDIchair and Motion are
two of Canada's leading health care brands; they are home to some of
the industry's most experienced, knowledgeable, and passionate people,
all with deep relationships in the communities they serve. We believe
that working together, with not just management, but also the sales
reps, store managers, franchisees and other staff, we can position
MEDIchair and Motion to thrive in a fast growing industry."
The sale is subject to certain regulatory approvals, including approval
by Canada's Competition Bureau, as well as customary closing
conditions, and is expected to close immediately following receipt of
all regulatory approvals, which are anticipated by no later than
mid-August of this year.
The retail home medical operations specialize in the sale of home
accessibility equipment, mobility devices and home medical supplies
through a network of 47 franchised and 30 corporate stores, operating
under the MEDIchair and Motion Specialties banners.
The sale does not include Performance Medical Group, which offers
state-of-the-art custom orthotics, off-the-shelf orthotics, custom
bracing, and laser and shockwave therapy at 50 locations across Canada
and through Centric Health's physiotherapy clinic network.
Centric Health Investor Day Details
Centric Health will host its 2014 Investor Day on Tuesday, June 24th from 9:00 a.m. to 11:00 a.m. at St. Andrew's Club in Toronto. To
register, email Danielle Babineau at firstname.lastname@example.org.
For those unable to attend the event in person, a live webcast will be
available on the Centric Health web site at http://www.centrichealth.ca/investors/events-and-presentations.
About Birch Hill Equity Partners
With $2 billion in capital under management, 20 partner companies and 31
fully realized investments since 1994, Birch Hill is the leader in
long-term value creation in the Canadian mid-market. As a group, Birch
Hill's partner companies represent one of Canada's largest corporate
entities with over $4.7 billion in total revenue and more than 28,000
employees. For more information about Birch Hill Equity Partners,
please visit www.birchhillequity.com.
About Centric Health
Centric Health's vision is to be Canada's premier healthcare company,
providing innovative solutions centered on patients and healthcare
professionals. As a diversified healthcare company with investments in
several niche service areas, Centric Health currently has operations in
medical assessments, disability and rehabilitation management,
physiotherapy and surgical centres, homecare, specialty pharmacy and
wellness and prevention. With knowledge and experience of healthcare
delivery in international markets and extensive and trusted
relationships with payers, physicians, and government agencies, Centric
Health is pursuing expansion opportunities into other healthcare
sectors to create value for all stakeholders with an unwavering
commitment to the highest quality of care. Centric Health is listed on
the TSX under the symbol CHH. For further information, please visit www.centrichealth.ca.
This press release contains statements that may constitute
"forward-looking statements" within the meaning of applicable Canadian
securities legislation. These forward-looking statements include,
among others, statements regarding business strategy, plans and other
expectations, beliefs, goals, objectives, information and statements
about possible future events. Readers are cautioned not to place undue
reliance on such forward-looking statements. Forward-looking statements
are based on current expectations, estimates and assumptions that
involve a number of risks, which could cause actual results to vary and
in some instances to differ materially from those anticipated by
Centric Health and described in the forward-looking statements
contained in this press release. No assurance can be given that any of
the events anticipated by the forward-looking statements will transpire
or occur or, if any of them do so, what benefits Centric Health will
SOURCE: Centric Health Corporation
For further information:
Chief Financial Officer
416-815-0700 ext. 257